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Obama's chief of staff Rahm Emanuel resigns to run for mayor

White House chief of staff Rahm Emanuel (left), one of US President Barack Obama's most influential aides, officially stepped down on Friday to run for mayor of Chicago. Emanuel was replaced by Pete Rouse, who will serve as interim chief of staff.

AFP - President Barack Obama Friday accepted the resignation of his "incomparable" chief of staff Rahm Emanuel, replacing him, for now, with a low-key but well connected Washington fixer Pete Rouse.

The departure of Emanuel, set to run for the job of mayor in his hometown of Chicago, offers Obama the chance to shake-up his White House staff after his Democrats absorb an expected thumping in mid-term elections in November.

Obama, making what he called "the least suspenseful announcement of all time," after a flurry of media reports, said Emanuel's exit was a "bittersweet" moment, as no one could have been a better chief of staff.

"It is fair to say that we could not have accomplished what we've accomplished without Rahm's leadership," Obama said, naming a staved-off economic depression and new health and financial reform laws.

Emanuel, a political hardman known for extreme energy and profanity, brushed away tears during a short, poignant speech, and responded with a heartfelt tribute to Obama.

"You had the guts to make the tough calls that stopped the freefall and saved our country from a second Great Depression," he told the president.

"Mr. President, I thought I was tough... I want to thank you for being the toughest leader any country could ask for in the toughest times any president has ever faced."

Emanuel stopped short of officially announcing a run for mayor and the president did not officially endorse him.

Rouse, who has been with Obama since he was a senator, and is renowned for navigating the corridors of power in Congress, forms a sharp contrast to the outgoing confrontational style of Emanuel.

"There is a saying around the White House -- let Pete fix it," said Obama, praising his new right-hand man as wise and skilled.

"Pete's known as a skillful problem solver, and the good news for him is that we have plenty of problems to solve."

True to his self-effacing reputation, at times during Obama's announcement in the White House East Room, Rouse appeared to be edging out of camera shot, literally shunning the limelight.

Notably, Obama said that Emanuel was leaving and Rouse was taking over at the start of the "next phase of our administration."

If Democrats, as expected, lose the House of Representatives and see their majority trimmed in the Senate in November's elections, the lofty ambition of Obama's first two years in office will be just a memory.

He will face a choice of launching an all-out political war with Republicans as he builds towards an expected reelection campaign in 2012, or may decide to seek thin seams of compromise with his foes on Capitol Hill.

Rouse's style might be seen as gelling with the latter possible strategy, though some observers expect him to yield to a more high-profile figure, like former Senate majority leader Tom Daschle for instance.

White House spokesman Robert Gibbs said that Rouse was a candidate to permanently fill the post of chief of staff, though no decisions were expected for several months.

Emanuel is the latest key player to leave the White House, following budget chief Peter Orszag and top economic adviser Christina Romer. Another top member of the economic team Larry Summers will also leave this year.

Such departures are not unusual at this stage of an administration, given the stress, long hours and comparatively low pay, of jobs in the West Wing.

Obama could not resist poking fun at Emanuel's reputation as a rare political bruiser who has spawned a rich trove of lore.

"A couple of years ago... I pointed out that Rahm, when he was a kid, had lost part of his finger in an accident, and it was his middle finger, so it rendered him mute for a while!"

Then turning the spotlight on Rouse, Obama quipped: "Pete has never seen a microphone or a TV camera that he likes."

Emanuel also spoke in warm personal terms of the president saying he had seen Obama's heart break, "when he writes a letter to parents whose son or daughter has been lost on the field of honor.

Emanuel got a less formal send off in the daily morning staff meeting at the White House, when Austan Goolsbee, the chairman of Obama's Council of Economic Advisors presented him with a dead Asian carp.

The gesture was a reference from one famous story about Emanuel, possibly apocryphal, that he once sent a dead fish through the mail to a pollster who had sparked his ire, echoing a famous scene in the movie "The Godfather."

A colleague added Emanuel had also been fixated with the problem of invasive Asian carp threatening Great Lakes eco-systems, near his new, hoped-for fiefdom of Chicago.